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Can Uk Agricultural Land Give Way To Housing?
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The hard argument between land for farms vs. homes is too binary. The shifting nature of agriculture and farmland suggest a spectrum of solutions.
In the quest for space in which to build homes, the UK faces some difficult choices. Government planning agencies encourage cities to remediate brownfield land. And the streamlined planning programmes - by way of the Localism Act of 2011 and the National Planning Policy Framework implemented in 2012 - empower local councils to identify where residential growth can and should occur in greenfield and greenbelt lands.
Of course, this runs counter to some long-held beliefs about how land should be used and what defines England itself. But with a 7 per cent per decade level of population growth, and with an additional one million homes needed to meet the needs of the present population, new ideas should to be entertained. All of this is studied in detail by strategic land developers, those investors who look for ways to bring new housing onto the market.
One contentious area is the discussion around farmland. What is its role in the UK economy? What might conversions of farmland to housing provide? Does this betray a critical English asset, its pastoral countryside?
It would be easy to find pro- and con- answers to all of these questions, depending on whom you speak with. But any discussion of the sanctity of farmland relative to the pressing, critical need to build houses, should incorporate the following notes:
Agriculture in the UK uses 70 per cent of total land area (including Scotland, Wales and England); agriculture’s contribution to the country's gross value added is 0.7% (£5.69 billion as of 2011).
Shelter England, the British housing charity, reported in June 2013 ("Getting Serious About the Housing Shortage") that 33,000 extra homes could be built per year with "greenbelt flexibility," which would be to swap greenbelt land on which homes could be built for the greening of (plant trees, etc.) other land in urban areas. The publication specifically identifies "low grade agricultural land with little landscape or environmental value," as much of greenbelt-designated land is used for agriculture. Note also that greenbelts comprise 13 per cent of the England landmass while all urban areas combined only constitute 7 per cent of that same area, including urban parks and gardens.
"Precision farming," a method by which technology enables identification of soil characteristics, that then enables smarter seeding and application of agrichemicals, increases per-hectare yields and reduces labour related to the growing season.
Organic and locavore trends may alter the mix of products and where they are grown. For example, if niche farms narrow in on this specialty market (e.g., in tonier sections of London), it shifts the use of land from larger-scale (e.g., wheat) to something smaller scale (arugula, specialty grains, etc.). Some crops require more land, others less.
Grass-fed sheep and cattle are becoming preferred over feedlot ("factory farmed") versions. This has a significant impact on the prices of mutton and beef (it makes them more expensive) but reduces the amount of land required to grow corn feed.
An argument against genetically modified crops (GM) has effectively kept them out of England and the EU. But The Scientific Alliance argued in its report on the Oxford Farming Conference that GM and other innovations in farming can increase yields without increasing land devoted to agriculture, and that natural, organic methods can be used with GM seeds. No one is saying if and when GM will come into acceptance, but it does present an intriguing idea where land use is discussed.
So while the debate rages, the point should be made that weighing housing development against agriculture is not an either-or choice. Instead, there are many ways of approaching land use changes.
One class of investors - real asset fund managers - look for the creative solution. Fund specialists work with local councils to identify land that is more suitable for development than other purposes, achieving zoning changes as needed. Once approved by a local planning authority (LPA), the investors build the infrastructure necessary to then turn over the land to homebuilders who construct market-appropriate homes.
Individual investors who consider investing in such funds should do so under the advice of independent financial advisors. There, the role of land investing can be put into context of the investor's overall goals and risk profile.
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